Riot Stock Rallies as Blockchain Tech Goes Mainstream

Riot Blockchain, Inc. (RIOT) shares soared more than 27% on Monday and exhibited significant volatility at the open on Tuesday. The move comes after JPMorgan Chase & Co. (JPM​), The Goldman Sachs Group, Inc. (GS), Citigroup Inc. (C) and other large banks completed a six-month test of the blockchain​ in the $2.8 trillion equity swaps market. The test saw a 100% success rate and demonstrated the ability to lower costs significantly. The news also sent bitcoin prices above the $8,000 mark for the first time.

On Tuesday, bitcoin prices fell more than 5% after Tether – an independent cryptocurrency – was hacked to the tune of $31 million. Tether's development team is working to prevent the stolen tokens from being used, but the move could damage the credibility of blockchain technology. The positive news is that the move out of Tether could be beneficial for bitcoin, Ethereum and other more established cryptocurrencies. (See also: Tether Hack: Cryptocurrency Worth $31 Million Stolen.)

Traders should watch for a move to R2 resistance at $12.54, where the stock could potentially see some consolidation given the lofty RSI readings. A breakout from R2 resistance levels could pave the way for the stock to reach fresh all-time highs as the blockchain technology company continues to benefit from the acceptance of the technology in the enterprise. Traders should keep in mind that the stock remains highly speculative, with a 2.66 beta coefficient. (See also: UK Firm's Stock Jumps on News It Will Add 'Blockchain' to Name.)

Chart courtesy of StockCharts.com. The author holds no position in the stock(s) mentioned except through passively managed index funds.

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